The Commission for the Protection of Competition (hereinafter the “Commission”) at its meeting held on 15/12/2021, approved the concentration for the acquisition of the share capital of VLPG PLANT Ltd (hereinafter the “VLPG”) by YUGEN LIMITED (hereinafter the “YUGEN”) which was renamed to EKO LOGISTICS Ltd (hereinafter the "EKO LOGISTICS") and the merged of Hellenic Petroleum S.A Group activities’ related to the storage and management of LPG with the respective business divisions of Petrolina (Holdings) Public Ltd, Synergas Ltd and Intergaz Ltd (hereinafter the “Founding Companies” of VLPG) which have already been merged through VLPG (Decision CPC48/2019). The Founding Companies together with EKO LOGISTICS, hereinafter the “Companies”.
This concentration was notified to the Service of Commission on 09/07/2021.
The Commission at its meeting held on 16/09/2021 concluded that the above notified concentration was within the scope of the Control of Concentrations between Undertakings Law of 2014, Law no. 83(Ι)/2014 (hereinafter the “Law”) and decided to proceed to a full investigation as serious doubts were raised as to its compatibility with the functioning of competition in the market. Therefore, the Commission decided to launch a full investigation.
In the context of full investigation, a relevant Press Release was posted on the official website of Commission and an announcement was published in the Official Gazette of the Republic, summarizing the doubts identified by the Commission.
In the context of full investigation, the Service provided additional information by the participating undertakings in the concentration as well as by the relevant bodies and businesses and submitted a report of findings to the Commission on 19/11/2021, on the basis of article 27 of the Law.
The Commission at its meeting held on 26/11/2021 assessed the Report of Findings and decided that there were still doubts as to the compatibility of the concentration with the functioning of competition in the market. The Commission, acting on the basis of Section 28(2) of the Law, compiled a report with the objections ascertained in relation to the incompatibility of the concentration with the functioning of competition in the market and informed the participating undertakings that they could submit any amendments to the concentration in writing as well as any other commitments so as to remove the doubts raised in the Report with the Objections. Prior its decision and on the basis of article 33(1) of the Law, the Commission held a hearing with the participating undertakings. Therefore, the Companies submitted a number of commitments with their final commitments being submitted on 14/12/2021.
The Commission, after studying and evaluating the final proposed commitments made by the Companies and VLPG, the Amended Shareholders Agreement of VLPG as well as the results of the full investigation of the concentration, the Commission considered that the commitments undertaken by them were sufficient to remove the doubts raised.
Therefore, the Commission, acting on the basis of article 28(1)(a) of the Law, unanimously decided that this concentration is compatible with the functioning of the competition in the market, on the basis of the commitments made by the participating undertakings. Specifically, the participating undertakings undertook the commitments that are valid based on the Decision CPC49/2018 that had been undertaken by the Founding Companies, which are as follows:
"(i) modification of the Shareholders' Agreement, in order to ensure that there will not be different pricing policies or terms and conditions between the companies involved and customers. The New Company will enter into transactions with all its customers under the same terms (at arm’s length),
(ii) modification of the Shareholders' Agreement, in order to ensure the cost-oriented pricing policy of the New Company regarding the provision of storage space, access to anchorage and transport pipelines,
(iii) ensure the possibility of renting storage space to at least two companies with a decrease in the minimum level of space necessary for accepting a company, and a commitment by VLPG that in the case where 10% of the total storage space is not used by a third party, then 100MT will be provided to the next applicant, even if the total storage space to third parties exceeds 10%,
(iv) ensure the provision of 10% of total storage space to third parties, in the case of extending the storage space,
(v) The provision a manual for protecting competition to all the members of staff of VLPG, in which all the policies of the Companies will be documented as well as the procedures that will have to be followed by all the members of staff who may have access to sensitive and/or confidential information.
(vi) appoint an independent third party who will be responsible for verifying compliance with all commitments and to submit an annual report to the Commission within the first quarter of each year confirming the implementation or non-implementation of the commitments by the VLPG with respect to the previous year,
(vii) a commitment not to prevent VLPG customers from using and renting facilities of a potential competitor, thus limiting any activity in the upstream or downstream market,
(viii) During the period of construction of the necessary facilities of the storage space and the twelve (12) month period from the start of the operation, the companies are obliged to hold any Board of Directors’ meetings of VLPG in the presence of an independent third party, who will ensure that no illegal coordination exists in the affected markets and that no sensitive information regarding VLPG is exchanged,
(ix) The members of the Board of Directors and the chief executive officers of the Companies will not hold any position in the Board of Directors of the New Company, twelve (12) months after the start of VLPGS’ operation,
(x) The commitments must be met for the entire period of VLPG’s operation.. "
In addition to the above, Hellenic Petroleum S.A Group undertook the following additional commitments:
· any use of the two of the plots owned by the Hellenic Petroleum S.A Group in the space designated by the Ministry of Energy, Trade and Industry for use in relation to LPG, will not concern and/or related to the storage and/or handling of LPG and in any case will not to compete with any activity of VLPG, provided that EKO Logistics Ltd and/or any other company of the Hellenic Petroleum S.A Group is a shareholder of VLPG.
· after the lapse of five (5) years from the date of the approval of the concentration by the Commission and in case the two aforementioned plots would not have been used for the declared reasons, nor the licensing process for alternative plans would have been started, or would not have been released in favor of the state by then, the plots in question would be released in favor of the state, and
· a representative of the Hellenic Petroleum S.A Group will provide full information to the Commission, within the first quarter of each year until the end of the five-year period, on all relevant developments.
The Commission notes that pursuant to Section 40(1)(d) of the Law, where the concentration is implemented without the fulfillment of a condition imposed by the Commission pursuant to Section 28(1)(a) of the Law, it may impose an administrative fine not exceeding ten per cent (10%) of the total turnover of the undertaking which has the obligation for notification, as defined in Schedule II, in the financial year immediately preceding the concentration and an administrative fine not exceeding eight thousand (8.000) euros for every day during which the infringement continues.
Finally, the Commission notes that under Section 45 of the Law, the Commission may revoke any decision taken on the compatibility of any merger with the functioning of competition on the market or may alter the terms of the decision if it finds –
(a) that false or misleading information has been supplied or that necessary information relating to this concentration has been withheld by the notifying party or by any other participant in the concentration or by any interested person, or
(b) that any term imposed on the participants in the concentration by the said decision has not been satisfied or has ceased to be satisfied.
The complete version of the Commission’s decision will be publicized in the Official Gazette of the Government and on the Commission’s website in the near future.
COMMISSION FOR THE PROTECTION OF COMPETITION